Playing the U.S. Dollar: UUP or UDN?

Everyone has an opinion on the value of the U.S. Dollar and where its headed.  Right off the bat you can buy two ETFs that trade on the bullish and bearish movements of the dollar, those options are the PowerShares DB US Dollar Index Bearish (NYSE:UDN) and the PowerShares DB US Dollar Index Bullish (NYSE:UUP).

The UUP is down 2% today and trading at $22.34 a share, the bullish dollar ETF was within 5 cents from hitting a new 52-week low this morning.  The UDN is trading flat today and staying right in the $28 range where it has been for the past month.  So how to you place your bet?

(Rueters/NYTimes.com) -- The rise in imports spurred some economists to downsize estimates for third quarter growth. The U.S. government said last month the U.S. economy grew at an annual rate 3.5 percent in the third quarter after four quarters of contraction.

"Today's U.S. trade report revealed a September import surge that will take a chunk out of the (government's) optimistic 3.5 percent advance third quarter gross domestic product figure, which we now peg at 2.9 percent," said Michael Englund,

Some analysts had expected more of an export boost because the drop in the value of the U.S. dollar against other major currencies makes American goods more competitive overseas.

But "the overall upturn in U.S. demand is trumping the fall of the dollar," said Craig Peckham, an equity trading strategist with Jefferies and Company in New York.

Depending on your risk appetite, the UUP deserves some attention at these low levels and traders have took notice. According to ETFTrends.com, last week trading in PowerShares DB U.S. Dollar Bullish (NYSE:UUP) was halted after it ran out of available shares. Trading was resumed after a filing with the SEC for 100 million additional shares was made. 

PowerShares DB U.S. Dollar Bullish (UUP) has been granted new shares by the Securities and Exchange Commission (SEC). Issuance will resume beginning this morning.

Happy safe trading and let's hope for all of us the U.S. Dollar starts making a comeback.

Disclaimer: No positions in any of the securities mentioned in this publication.